1
EXHIBIT 10.73
EXECUTION COPY
XXXXXX OPTION AGREEMENT
This Xxxxxx Option Agreement (the "Option Agreement"), entered
into as of April 3,1996, between ETC w/tci, Inc., a Delaware corporation (the
"Company"), and Xxxx Xxxxxx (the "Executive").
W I T N E S S E T H:
WHEREAS, the Company has adopted the 1996 Incentive Plan (the
"Plan") effective as of the Effective Date (as defined in the Plan) in order,
among other things, retain and attract key employees of the Company and its
subsidiaries to encourage a sense of proprietorship of such employees and to
stimulate the active interest of such persons in the development and financial
success of the Company and;
WHEREAS, Section 21 of the Plan provides that the Executive shall
be granted an option to purchase certain shares of Common Stock, par value $.01
per share of the Company (the "Common Stock"), upon the occurrence of specified
events;
WHEREAS, capitalized terms used herein but not defined herein
shall have the meanings assigned to such terms in the Plan;
NOW, THEREFORE, in consideration of the premises, the terms and
conditions set forth herein, the mutual benefits to be gained by the
performance thereof and other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties hereto agree as
follows:
1. Subject to the terms and conditions set forth herein, the
Company hereby grants to the Executive an option (the "Xxxxxx Option") to
purchase (i) all shares of Common Stock initially available for Awards under
the Plan on the Effective Date as adjusted from time to time pursuant thereto
("Plan Shares") which are not Vested Stock as of the close of business on the
Option Exercise Date (as defined in Section 2 hereof) and all shares of Common
Stock acquired by Participants pursuant to the exercise of their preemptive
rights and subsequently repurchased by the Company pursuant to the Call (as
defined in the Plan) (collectively, the "Primary Shares"); and (ii) all Plan
Shares which from time to time cease to be subject to outstanding Awards after
the Option Exercise Date other than as a result of their acquisition by a
Participant free and clear of any restriction on disposition or risk of
forfeiture ("Secondary Shares").
2
2. The Xxxxxx Option shall become exercisable as to all
Primary Shares on the Option Exercise Date and as to Secondary Shares at such
times after the Option Exercise Date as such shares cease to be subject to an
outstanding Award. The Xxxxxx Option shall expire on the date which is five
years and thirty days after the termination of the Plan in accordance with
Section 11 thereof. For purposes of this Option Agreement, the "Option
Exercise Date" shall occur upon the earliest to occur of the following:
(i) the date of the termination of the Plan in accordance with
Section 11 thereof;
(ii) 30 days prior to the date of the Unwind unless the
Company's Public Offering shall have occurred;
(iii) the date a Change in Control of the Company is
consummated;
(iv) any date to or upon which vesting of Awards is accelerated
generally under the Plan; and
(v) the date of effectiveness of any plan of dissolution or
liquidation of the Company.
The Company will promptly notify Xxxxxx of the occurrence of any
event specified in clauses (iii), (iv) or (v) above. Notwithstanding any other
provision of this Agreement, the Xxxxxx Option shall be exercisable for not
less than 30 days after receipt of such notice or the occurrence of an event
set forth in clauses (i) through (v) above, which is later.
3. The Xxxxxx Option will be exercisable at the following
prices: (i) as to the Option Shares which are shares of Common Stock acquired
by Participants pursuant to the exercise of their preemptive rights and
subsequently repurchased by the Company pursuant to the Call, at a price per
share equal to the purchase price paid by the Company upon exercise of the Call
and (ii) as to all other Option Shares, at a price per Option Share equal to
the Fair Market Value of the Common Stock of the Company on the date hereof as
determined by the Board of Directors which shall be $0.10 per share.
4. The Xxxxxx Option granted pursuant to this Option
Agreement may be exercised during the Option Period, by the Executive giving
written notice to the Secretary of the Company setting forth the Executive's
desire to exercise the Xxxxxx Option, which notice shall be accompanied by
payment of the full amount of the exercise price for the Xxxxxx Option and any
appropriate withholding taxes in accordance with Section 8 hereto. In
addition, such notice shall specify the address to which the certificate or
certificates for such shares are to be mailed. All payments by the Executive
hereunder shall be made in cash or by means of tendering theretofore owned
Common Stock which has been held by the Executive for more than six months,
valued at Fair Market Value on date of exercise, or any combination thereof.
As promptly as practicable following the receipt of such written notification
and payment, the Company shall deliver to the
-2-
3
Executive certificates for the number of Option Shares with respect to which
such Xxxxxx Option has been exercised.
5. In the event that the termination of employment of the
Executive with the Company occurs by reason of voluntary termination by the
Executive or termination by the Company with cause (provided that a Change in
Control has not occurred prior to such termination) and the Option Exercise
Date has not yet occurred, the Xxxxxx Option granted pursuant to this Option
Agreement shall terminate and shall not at any time thereafter be exercisable
by the Executive.
6. The Xxxxxx Option granted pursuant hereto shall not be
assignable or otherwise transferable by the Executive other than to a Permitted
Transferee. No assignment of the Xxxxxx Option herein granted shall be
effective to bind the Company unless the Company shall have been furnished with
written notice thereof and a copy of such documents and evidence as the Company
may deem necessary to establish the validity of the assignment and the
acceptance by the assignee or assignees of the terms and conditions hereof.
7. The Executive shall have no rights as a stockholder of the
Company with respect to the Option Shares unless and until the Xxxxxx Option
has been exercised with respect to such Option Shares. Until such time, the
Executive shall not be entitled to dividends or distributions in respect of any
Option Shares or to vote such shares on any matter submitted to the
shareholders of the Company. In addition, the number of shares which are
Option Shares at any time after the date hereof shall be adjusted by the Board
of Directors in the same manner as the adjustments made to the shares Common
Stock subject to Awards under the Plan as provided in Section 13 of the Plan.
8. The Company shall have the right to deduct or withhold
applicable taxes upon exercise of the Xxxxxx Option. At the Executive's
option, such withholding may be satisfied by the payment of taxes or the
withholding of shares of Common Stock otherwise issuable upon such exercise.
In addition to the foregoing, any withholding obligation may be satisfied at
the option of the Executive by the delivery to the Company of shares of Common
Stock already owned by the Executive. If shares of Common Stock are used to
satisfy withholding, such shares shall be valued based on their Fair Market
Value on the date of exercise the Xxxxxx Option.
9. Upon the acquisition of any Option Shares pursuant to the
exercise of the Xxxxxx Option granted pursuant hereto, the Executive may be
required to enter into such written representations, warranties and agreements
as the Company may reasonably request in order to comply with applicable
securities laws. In addition, the certificates representing any Option Shares
purchased upon the exercise of the Xxxxxx Option will be stamped or otherwise
imprinted with a legend in such form as the Company may require with respect to
any applicable restrictions on sale or transfer required pursuant to state or
federal securities laws, and the stock transfer records of the Company will
reflect stop-transfer instructions, as appropriate, with respect to such
shares.
-3-
4
10. Unless otherwise provided herein, any notice or other
communication hereunder shall be in writing and shall be given by registered or
certified mail. All notices of the exercise by the Executive of the Xxxxxx
Option granted pursuant hereto shall be directed to ETC w/tci, 000 Xxxxxxxxxx
Xxxxxx, X.X., 0xx Xxxxx, Xxxxxxxxxx, X.X. 00000, Attention: Secretary or at
such other address as directed by the Company. Any notice given by the Company
to the Executive directed to him at his address on file with the Company or
such other address of which the Executive or his assignee shall notify the
Company shall be effective to bind any other person who shall acquire rights
hereunder. Except as otherwise provided herein or in the Plan, the Company
shall be under no obligation whatsoever to advise or notify the Executive of
the existence, maturity or termination of any rights hereunder and the
Executive shall be deemed to have familiarized himself with all matters
contained herein and in the Plan which may affect any of the Executive's rights
or privileges hereunder.
[Signatures continued on next page]
-4-
5
IN WITNESS WHEREOF, this Option Agreement has been executed as of
the date first above written.
ETC w/tci, Inc.
By:/s/ Xxxxxxx X. Xxxxx
---------------------------
Name:
Title:
EXECUTIVE:
/s/ XXXX XXXXXX
------------------------------
Xxxx Xxxxxx
